U.S. adding 33 Chinese companies, institutions to economic blacklist By Reuters

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© Reuters. FILE PHOTO: U.S and China trade talks in Beijing

By David Shepardson and Karen Freifeld

WASHINGTON (Reuters) – The United States said on Friday it would add 33 Chinese firms and institutions to an economic blacklist for helping Beijing spy on its minority Uighur population or because of ties to weapons of mass destruction and China’s military.

The U.S. Commerce Department’s move marked the Trump administration’s latest efforts to crack down on companies whose goods may support the Chinese military and to punish Beijing for its treatment of Muslim minorities. It came as Communist Party rulers in Beijing on Friday unveiled details of a plan to impose national security laws on Hong Kong.

Companies and institutions were sanctioned for being “complicit in human rights violations and abuses committed in China’s campaign of repression, mass arbitrary detention, forced labor and high-technology surveillance against Uighurs” and others, the Commerce Department said in a statement.

Seven companies, including top tech firms, were sanctioned for “enabling China’s high-technology surveillance” in Xinjiang. The Commerce Department also added 24 companies, government institutions and commercial organizations to the economic list for supporting procurement of items for use by the Chinese military.

The blacklisted companies focus on artificial intelligence and facial recognition, markets that U.S. chip companies such as Nvidia Corp (O:) and Intel Corp (O:) have been heavily investing in. Nvidia did not immediately respond to a request for comment.

Among the companies named is NetPosa (SZ:), one of China’s most famous AI companies, whose facial recognition subsidiary is linked to the surveillance of Muslims. It once harbored hopes of selling its technology in the United States. The company could not be reached for comment.

Qihoo360, a major cybersecurity firm taken private and delisted from the Nasdaq in 2015, recently made headlines for claiming it had found evidence that CIA hacking tools were used to target the Chinese aviation sector. Qihoo did not immediately return a message seeking comment.

The Commerce Department said it was adding the firms to its “entity list” which bars the companies and organizations from access to U.S. technology without specific U.S. government approval.

Softbank Group Corp-backed (T:) CloudMinds was also added. It operates a cloud-based service to run robots such as a version of Pepper, a humanoid robot capable of simple communication. The company was blocked last year from transferring technology or technical information from its U.S. unit to its offices in Beijing, Reuters reported in March.

A representative of CloudMinds did not immediately respond to requests for comment.

The new listings follow a similar October 2019 action when Commerce added 28 Chinese public security bureaus and companies – including some of China’s top artificial intelligence startups and video surveillance company Hikvision (SZ:) – to a U.S. trade blacklist over the treatment of Uighur Muslims.

The actions follow the same blueprint used by Washington in its attempt to limit the influence of Huawei Technologies Co Ltd [HWT.UL] for what it says are national security reasons. Last week, Commerce took action to try to cut off Huawei’s access to chipmakers.

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